OPRA - Opera Q1: Seizing Opportunities In Antitrust Climate For Steady Growth (Upgrade)

2024-05-08 11:07:46 ET

Summary

• Q1 results were slightly better than our expectations and consensus estimates due to ongoing trends of GX adoption and the relatively low hiring pace.
• Antitrust restrictions create an additional momentum for Opera’s financial results.
• Despite Opera investing heavily in its new AI data center, margins remain stable because hiring remains moderate.
• We’ve increased our target multiple from 14.0x to 17.3x due to significant projected growth rates and stable profitability rates. My recommendation was upgraded to BUY.

Investment thesis

Opera (OPRA) continues to show decent financial performance due to its strategic initiatives and growth prospects. The go-to-market strategy works outstanding because GX MAU’s and the ARPU continue to increase drastically. At the same time, the bottom-line remains stable, and the company demonstrates outstanding margins rates....

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